News

16.09.2016

Council of Ministers decision dated 14th September 2016, in regards to the Scheme for Naturalisation of Investors in Cyprus by Exception

By a decision approved by the Council of Ministers of Cyprus on 14th September 2016, the Scheme for Naturalisation of Investors in Cyprus by Exception was amended, pursuant to section 111A (2) of the Civil Registry Laws 2002-2015. Investors can now apply for Cyprus Citizenship by making a stand-alone application (the previous ‘collective investments’ application has been abolished), upon making an investment under the new criteria which must be retained for a period of three years.

A.1 Investment in Real Estate: such as immovable property, developments and infrastructure projects. Under this investment plan, the applicant has to invest at least €2 million for the purchase and/or construction, and/or creation of developments such as commercial projects and/or development in the tourist sector and/or any other infrastructure projects. However, if the land is eligible for construction, a business plan needs to be presented to the relevant Authorities for approval. The total investment must be a minimum of €2 million, provided that one residential property is of at least €500.000 (excluding VAT). The residential property must be kept permanently.

A.2 Purchase or Incorporation of a Cyprus Company or participation in Cyprus businesses or Cyprus Companies.

The Applicant can invest at least €2 million in order to purchase, incorporate or participate in companies, that have physical presence and activities in Cyprus and employ at least five Cypriot or EU citizens who have been legally residing in Cyprus for a continuous period of at least 5 years. The minimum number of employees increases where more than one applicant invests in the same investment.

The Applicant can purchase financial assets of at least €2 million from organizations of alternative investment funds (AIFs), which are registered and whose activities are operated in the Republic of Cyprus and are licensed and supervised by the Cyprus Securities and Exchange Commission (the CySEC). Any other investments which are approved by the Ministry of Finance may qualify for the present investment scheme.The administrator and the auditor of the Fund is obliged to report to the relevant Ministries on an annual basis, that the initial investment amount is in place.

A.4 Combination of the above

Applicants can have a combination of any of the above criteria amounting to at least €2 million. Within this, the applicant may also purchase government bonds of the Republic of Cyprus of a maximum amount of €500.000.

B. TERMS AND CONDITIONS

1.Clean Criminal Record: the applicant must have a clean criminal record. Furthermore, his name must not be included in the list of persons whose assets, within the boundaries of the European Union, have been frozen as the result of sanctions.

2. Residence in the Republic of Cyprus: In all cases listed in Part A, the applicant must possess a permanent privately-owned residence in the Republic of Cyprus, the purchase price of which must be at least €500.000, plus V.A.T.

It is noted that members of the same family, who apply separately as investors, can collectively acquire a residence, provided that the total value of this home-property covers the amount of €500.000 per each applicant.

In case that the purchase value of the permanent privately owned residence in Cyprus exceeds the amount of €500,000, part of this additional amount can be used for purposes of supplementing the total amount of the investment made on the basis of the criteria of Part A above.

Additionally, it is noted that if the applicant has invested in housing unit/units on the basis of the aforementioned criterion A.1, the purchase of another permanent residence in Cyprus will not be required, if at least one of these housing units is worth at least €500,000, plus VAT, provided that the applicant retains the possession of the residence for life.

3. Residence Permit in Cyprus: The applicant, prior to his/her naturalization as a Cypriot citizen must hold a residence permit in Cyprus.

If the applicant does not already hold a residence permit, he/she may apply for an immigration permit on the basis of Regulation 6 (2) of the Aliens and Immigration Law, simultaneously with the application for naturalization. If the application for acquiring an immigration permit is made solely for purposes of acquiring the Cypriot citizenship, in accordance with the provisions of this Scheme, there are no other conditions than those stated in both Part A and Part B of this Scheme.

It is noted that all of the above also apply for the adult members of the family of the investor, who will apply for naturalization.

In case the application for naturalization is rejected for any reason, the immigration permit, obtained in accordance with the provisions of this Decision, will be canceled immediately.

THE AMENDMENTS:

A combination of all economic criteria is now possible.

The investment amount has been reduced to €2 million plus €500.000 (excluding VAT) for residential property for investments A2 – A4.

The applicant is obliged to obtain permanent residency in order to be approved for Cyprus Citizenship.

The applicant’s parents are also entitled to apply for Cyprus citizenship by exception provided that they own a lifetime residence of at least €500.000 (excluding VAT).

Where the purchase price of the residential property exceeds the amount of €500.000 (excluding VAT), the excess amount can be calculated and included in the whole investment.

There is a limit of €500.000 in regard to purchase of Cyprus Government Bonds.

The criterion of bank deposits has been canceled.

A broader range of investments is now possible, including land for development, AIF’s and financial assets (bonds and debentures) of Cyprus companies issued by the CySEC.